Resolving a Direct Hit from Indirect fire

I'd like to confirm my application of the rules...

In a recent Tobruk game my Brit off-table 3" mortars successfully landed a barrage getting a hit, 2 pins and a miss. The closest Italian unit was the FHQ in a building so took the direct hit - we'll ignore the other results for now. We then did:

1. took the HE rating: 4/4+ (IIRC)
2. rolled 3 hits/casualties
3. opponent failed all cover saves
4. FHQ now down to one man
5. rolled morale test - failed- unit routed
6. BR Chit drawn for loss of unit ( I can't recall if Italians have Senior officer rule - if yes then they pulled 2 chits)

Is this correct application of the process?
Thanks in advance...

That's how we would do it.

that would be a very roll of dice by the Italians!
Yes, you did it right.
Also nice that you remembered to check if they have the senior officer trait. Many, many times I´ve made my opponent incorrectly take two chits for his lost Soviet FHQ (Barbarossa games). As they have no senior officer skill.

Glad my interpretation was correct.
Thank you.

A supplementary question - the FHQ rolls a morale test for taking casualties; does it do a second test for 'last man', or is it one test to cover both causes?

There is no test for Last Man Standing. The rule is simply that if that last soldier is pinned then he automatically routs and the unit is considered destroyed.

OK, got it, thanks